Re: [WARNING][You MUST Reset Google Wallet When Switching ROMs!]
It's also worth noting that the Secure Element, by design, locks down if it perceives tampering. The condition can be triggered either physically, or via software (i.e Google Wallet).
I believe there are multiple causes of a "lock out", and I have successfully replicated one. Resetting Google Wallet (as is recommended prior to flashing), flashing a new ROM, and restoring Google Wallet from backup will lock the Secure Element. In trying to trigger the condition, I came across this sequence and confirmed it on a second device. I can also say that, based on my own repeated flashing and attempts to trigger the lock out, I do not believe that resetting Google Wallet prior to flashing is necessary. As long as a fresh copy of Google Wallet was installed on the new ROM, I always got through setup without trouble.
Finally, I can confirm that S Beam does not work once the SE lockout had been triggered. This is a good thing because it provides anyone with a borked SE a legitimate warranty claim. Samsung phones come with a 1yr manufacturer's warranty. RMA's can be filed online without talking to annoying reps, and their turnaround time is 10 days. I suggest that anyone with a locked out SE who purchased the phone less than a year ago, go to the Samsung website and file an RMA for your phone. Get it replaced. You'll have to use a backup for a few days, but it's better to take care of it now while you still have the warranty.
Sent from an evil, dark place...
~ ROM: JellyBomb v14.0
~ Radio: L900VPAMA7
~ Kernel: Perseus alpha32